South Korean companies Posco Future M and LG Energy Solution (LGES) have signed a memorandum of understanding to expand their collaboration on battery materials. The agreement covers LFP cathode materials, synthetic graphite, ultra-high-nickel cathode materials, and future products such as sodium-ion battery materials and silicon anodes.
According to Posco Future M, the company will supply a total of 720,000 tonnes of cathode and anode materials to LGES over a seven-year period. The company has not specified how this quantity will be distributed among the individual material types. The partners intend to finalise a formal contract later this year.
The ramp-up for LFP is expected to be particularly rapid. Posco Future M plans to convert existing production lines for high-nickel cathode materials at its Pohang plant to LFP and begin supplying LGES from early 2027. The company states that some of the lines have already been retrofitted accordingly.
In the future, Posco Future M also intends to use a new process that utilises lithium sourced from the Argentine salt lakes of the Posco Group. This is expected to further reduce costs and secure supply more firmly within its own value chain.
Battery material deliveries to begin in early 2027
The two companies also aim to strengthen their collaboration on anode materials. Synthetic graphite will be produced in Korea and Vietnam and supplied to LGES. Posco Future M highlights its advantages in fast-charging capability and lifespan.
In addition, the MoU includes the joint development of future battery materials, such as those for sodium-ion batteries, ultra-high-nickel cathodes, and silicon anodes.
The partners also plan to deepen their cooperation on existing NCM deliveries. In the medium term, they aim to increase the proportion of metals recovered from used batteries. According to Posco Future M, this will improve cost efficiency while strengthening material cycles.
The cooperation also aims to better mitigate regulatory and geopolitical risks. Both companies intend to jointly respond to new requirements in key markets, such as stricter supply chain regulations in the USA and Europe. In 2024, both LG Energy Solution and Posco announced plans to delay and reprioritise battery investments due to weaker demand for electric vehicles. The new agreement therefore signals less of a return to blanket growth and more of a targeted investment in cell chemistries and materials that are gaining importance for more affordable electric vehicles, stationary storage, and future battery generations.
With the seven-year framework, Posco Future M and LG Energy Solution are significantly expanding their collaboration beyond traditional high-nickel materials. The rapid entry into LFP in particular demonstrates how strongly priorities in the battery industry are shifting.
